PPD sets out $1B IPO plans as it launches new China labs

CRO PPD could raise as much as $1 billion in an IPO, according to Renaissance Capital. (Nasdaq)

No, that headline is not in error: The folks over at Renaissance Capital see private-cum-public-cum-private-cum-public CRO PPD putting down a very conservative $100 million IPO attempt, but it could raise a cool $1 billion.

The pharma services major filed with the Securities and Exchange Commission to raise up to $100 million in an IPO, but Renaissance Capital says: “However, the deal size is likely a placeholder for an IPO that we estimate could raise $1 billion.”

The CRO went private all the way back in 2011 when it was bought by Carlyle Group and Hellman & Friedman in a $3.9 billion deal. Two years ago, it recapitalized, with the owners expanding the company’s ownership to include two new investors: a subsidiary of the Abu Dhabi Investment Authority and an affiliate of GIC, Singapore’s sovereign wealth fund.

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This valued the company at around $9 billion; it currently makes about $4 billion in revenue a year, with clinical development services making up more than 80% of that revenue and the rest coming from its lab services unit.

It plans to list on the Nasdaq under the "PPD" ticker.

As well as an attempted IPO, PPD says it is also boosting its operations and leadership team in China to “provide enhanced clinical development, laboratory, regulatory, site conduct, patient access and post-approval services for international and China-based biopharmaceutical companies.”

It hopes to delve deeper into the often tumultuous but potentially major China market; PPD already has a presence there with clinical development offices in Beijing and Shanghai but will now double down on these, while also opening new offices in Guangzhou and Shenyang.

Going forward, the company said in a statement: “In 2020, PPD Laboratories plans to open a multifunctional lab in China offering bioanalytical, biomarker and vaccine sciences services. In addition, the company’s Accelerated Enrollment Solutions (AES) business—which offers distinctive site conduct and patient access solutions—added China to its global footprint for delivery of performance-based enrollment solutions for chronic ambulatory trials, leveraging its partnership with more than 300 hospitals in China.”

To oversee this growing business in China, PPD has also now named Ding Ming, Ph.D., as vice president and general manager of the company’s China operations, while Di Cindy Wu has been named executive director of PPD Laboratories to "provide direct oversight" of the company’s lab ops in China and Singapore.

“The new laboratory we plan to open in China this year will significantly enhance our capabilities in the Asia-Pacific region, where we already have central labs in Shanghai and Singapore,” said Christopher Fikry, M.D., executive vice president of PPD Laboratories.

“Because it will include bioanalytical, biomarker and vaccine laboratory capabilities combined in one location, this new facility will enable us to better support the global needs of our customers and further establish PPD as a leading drug-development laboratory in China.”

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